Credit Cards | Debt | Car | Chapter 13 | Chapter 7 | Foreclosure | Back Taxes | IRS | Hospital Bills

The Help You Need...
to let go of your debt.

Menu

Bankruptcy can be a safer path than debt settlement

Faced with financial difficulties, many Arkansas residents will go to great lengths to extricate themselves from high levels of debt. For some, this will include considering bankruptcy, as well as an initial attempt at debt settlement, a process by which consumers pay one monthly sum to a company that in turn negotiates debt terms and makes payments to one's creditors. While there are certainly some reputable debt settlement companies to be found, the industry is rife with scams, including one run by a  company called World Law Group, which was recently subject to a preliminary injunction.

World Law Group was charging clients an "enrollment fee" of $199, which was collected before any services were rendered. Collecting up-front fees for debt relief services is against the law, although it is a common practice within the industry. In addition, World Law Group was charging clients a monthly fe of $84.95, in addition to a range of other services that added between 10 and 15 percent to the total debt owed.

This means that in order to make any forward progress, clients had to pay nearly $200 to initiate the service, then nearly $85 each month to maintain that service. Often, debt settlement agreements become void if payments are missed, and creditors can charge high fees if the terms of the settlement are not honored. This could leave consumers still mired in debt even after spending years making monthly payments.

For many in Arkansas, bankruptcy offers a more secure and efficient path toward the elimination of consumer debt. There are a number of different bankruptcy options available, and there is a solution to fit virtually every set of needs. When considering debt relief options, consumers should gather as much information as possible, so that an informed decision can be made.

Source: thestreet.com, "Buried in Debt? Here's How to Protect Yourself Against Deceptive Debt Relief Programs", Kevin Yu, Sept. 16, 2015

No Comments

Leave a comment
Comment Information

Privacy Policy | Business Development Solutions by FindLaw, part of Thomson Reuters.